Compulsory Purchase

Compulsory Purchase Orders were first introduced in Government Bills in the Nineteenth century for the building of railways, and they were seen as a terrible attack on property ownership at the time – though of course without them landmark projects of that kind could never have been realised. Many Victorian landowners quickly realised the benefits which train travel would bring them. Compulsory Purchase Orders were then extensively used post war and again in the Sixties and Seventies for slum clearance, large scale re-developments and an explosion in road and rail construction. At that time it was already recognised that a system bought in over 100 years ago was struggling and frequently unfair. Lord Denning, who could often be relied upon to cut to the chase, pressed for a reform of the legislation in the 70’s. Sadly 40 years on we are still awaiting any meaningful reform. That does not mean that robust negotiation and skill cannot be brought to bear to protect our clients, be they landowner, occupier or nearby resident.

We have represented clients for decades threatened with Compulsory Purchase Orders. Cuts in national infrastructure a few years ago meant that many large projects were cancelled or delayed, and there were far fewer Compulsory Purchase Orders issued. The effect of those cuts in budgets have meant, particularly here in the south east, road congestion, over-crowded railways, and a lack of housing in several sectors of the market.

During the last years of the coalition Government a number of infrastructure projects were brought back into play though; many of which were overdue and much needed. Over the last two years alone the value of these projects across England has grown to a staggering total of £50 billion. In this part of the country the majority of these schemes relate to road building. These include the widening of the A21, the A27, the M25, the Arundel relief road, and the Bexhill to Hastings link road.

The biggest bone of contention about Compulsory Purchase Orders has always been the levels of compensation, and that is still true today. Rural business groups have lobbied the government tirelessly to try and get the basis of compensation improved. In theory no landowners should be disadvantaged by a Compulsory Purchase Order. An open market value is placed on the land, but there is an assumption of no actual loss and no material gain. Most importantly the market value excludes any uplift associated with the proposed scheme itself. That might seem fair in principle, but one immediate problem is that these projects are notorious for taking a very long time from inception to formal launch. Many property owners find their property negatively affected by a draft proposal, well before there is any statutory right to compensation. This pre-scheme “blight” and the associated effect on the value can be very hard to compute. The uncertainty can easily last for decades. This does not just affect home owners; local businesses may find their expansion plans thwarted as well.

An example often quoted is that of the HS2 rail link. This is clearly a great concern for many but we have seen similar situations here in the south east along the East Sussex sections of the A21 and now along sections of the A27. I challenge anyone to say when either scheme will actually be rolled out.

In cases such as this, properties and land can be almost impossible to sell – let alone at their true value – and businesses cannot plan development or expansion. In some instances, such as the disposal of land or buildings to meet inheritance tax, owners have no choice but to sell, and the Compulsory Purchase Order leaves them in an invidious and highly unfair position.

Parts of the A21 are used by as many as 35,000 cars a day, and a section of the road was said to be one of the most dangerous roads in the south east. This firm has represented around a dozen clients affected by the proposed widening for some years now, but work is only beginning this spring on a small section near Tunbridge Wells, having been put on hold several times.

Over the next couple of decades there are likely to be many more infrastructure projects, large and small, across the country; utilities and railways as well as roads. We are already seeing gas, water and electricity companies needing to undertake substantial upgrading as greater demands are made upon the utilities by new residential developments.

In many cases the land take is not limited to what is required for the development, but, for example, the Highways Agency adding landscaping and mitigation work to the scheme, and therefore increasing the area of land compulsorily acquired, which may in itself have a detrimental effect on the remaining property.

One other form of development currently subject to a Compulsory Purchase Order is a massive offshore wind farm on the South Coast. We are currently representing numerous clients whose land will accommodate a massive power line running from the coast to 20 miles inland. Whilst the acquiring authority in this case is comparatively co-operative, our farmers are left this season not knowing if the developers will come in this harvest or next to dig up a 50m swath of their crops – not a happy position for anyone to be in.

The firm’s responsibility to its clients is to compute what we judge to be a fair value for the Compulsory Purchase Order, to have regard to the relevant legal and valuation principles but then to negotiate robustly to maximise all heads of claim. With experience one knows how far to push and what can be achieved. It is also necessary to vigorously manage the project itself, including access arrangements, to reduce stress, disruption and nuisance for the clients. Too often we find that, whilst the acquiring authority aims to act reasonably, overly enthusiastic contractors can create real issues on site.

In all fairness it should be recognised that the claimant’s duty is to mitigate their losses and support any claims for compensation with detailed evidence. Putting the right systems in place from day one, agreeing early entry arrangements, access provisions and securing robust advanced payments is all key. Starting on the right foot and ensuring the case is managed from first enquiry to settlement of the final claim requires experience and attention to detail.

Case Study- widening the A23

We recently acted for clients who own a very attractive house alongside the A23 south of Gatwick. A scheme to widen the road was approved and Compulsory Purchase Order procedures started to acquire strips of adjacent land to accommodate the scheme. In this case the owners were to lose their existing access directly off the A23, to be replaced by a shared side road on the other side of their home. Only a very small strip of land was to be taken. Nevertheless it was immediately apparent to us that their property would be substantially affected by the scheme.

Urgent discussions with the Highways Authority started the moment the scheme was proposed and formal representations about essential mitigation measures were made at the subsequent public inquiry. We argued vigorously that an extensive programme of landscaping of the grounds was required, in addition to a new driveway, gates and associated facilities together with robust compensation payments for injurious affection, disturbance and disruption. Most significantly we won the argument that their own Project Managers, being Batcheller Monkhouse, should be retained throughout the three years of the scheme at the Highways Authority’s expense to appoint contractors and manage the build. This ensured the clients’ requirements were properly represented and such works were not simply seen as part of the massive road construction programme itself.

It took a staggering 6 years from public inquiry to completion but throughout our clients had the satisfaction of knowing that they could call on us to represent them without any financial burden.